Update: Mexico and Brazil Talks of Free Trade Agreement

“Brazil currently has trade negotiations under way that date far back with many different countries,” Espinosa said in an interview in Bloomberg’s Mexico City offices yesterday. “This makes us think that it’s a country in which there isn’t much flexibility for a negotiation.” Mexican President Felipe Calderon and former Brazilian leader Luiz Inacio Lula da Silva vowed in 2010 to start talks on a free-trade pact between the two countries. This potential free trade agreement would help Mexico diversify trade away from the U.S., which buys 80 percent of its exports, but it seems like it may be deterred by Brazil’s efforts to boost protection for it's manufacturers being hurt by a rally in its currency and increased competition from China. Espinosa said that while “it’s difficult” to determine if Calderon will be able to sign a trade agreement with Brazil before his term ends in November 2012, the government is putting forth its best effort.